The personalized approach to sales

HANOVER -- Bob Samuels is in the final stretch of the holiday season.

Unlike most people, he's not buying. He's selling. And so far, this season has been tougher than last year's, hampered by rising energy prices and belt-tightening attitudes. Sales at his Learning Express toy store are slightly down for the year.

Samuels also has had to combat deep discounters like Target and Wal-Mart that have aggressively slashed prices, making it one of the most promotional Christmas shopping periods in years.

''I check their prices and try to be as competitive as I can," he says. ''If I try to go head-to-head with them, I'll lose."

For Samuels and retailers like him, the devil really is in a million details that lead up to Christmas. These last few months are a critical time when stores make up to 40 percent of their annual revenues. During the holidays, Learning Express, a Devens toy chain of 114 franchised stores, not only competes with year-round rivals like Toys ''R" Us and KB Toys, but also the myriad of merchants, such as Barnes & Noble, that get into the toy business at the end of the year.

Above all, Learning Express, a privately held company, can't afford to compete with discounters on price.

And how can they? At one point this season Target had on sale the board game 20 Questions for less than $9. At Learning Express, it sells for $14.99.

Big discounters can more easily absorb the price cuts because toy sales are a way to get people in the door to spend money on other items. To compete, Learning Express franchisees have developed a strategy of personalized merchandise, exclusive toys, free gift wrapping, and shipping services to lure customers.

A year ago Samuels watched, petrified, as Wal-Mart opened across the street in the Hanover Mall. He survived last Christmas with solid sales but knew he had to do something different.

His planning began in February when he started to attend toy fairs and pore through catalogs to pick out Christmas toys. He shed some Lego sets and high-priced Leapfrog electronic educational toys because the competition could heavily discount on those products.

Meanwhile, Samuels decided to expand where the Wal-Marts of the world can't: doubling his offering of personalized merchandise, such as piggy banks and toy buckets with children's names painted in bubble letters. As early as June, employees started the labor-intensive process, sometimes spending four hours painting decorations on a toy chest. These kind of handcrafted items now make up 15 percent of his inventory.

Beyond personalized merchandise, the biggest focus during the holiday season is service. At specialty stores like Learning Express, customers count on knowledgeable staff who can dispense toy advice effortlessly. Plus, they gift wrap for free -- one store used at least 20,000 feet of wrapping paper during the last two months.

Rich Gibson, owner of the Learning Express in Newton, gave his holiday pep talk to employees back in October. First he lured his staff in at 8 a.m. on a Sunday -- four hours earlier than usual -- with promises of free coffee, doughnuts, and cash prizes. Gibson stacked a wad of dollar bills on a shop counter and divided the employees into teams, and began grilling them with questions they were likely to hear from customers: ''What are the most expensive items in the holiday catalogue? How much does it cost to ship to California? What are the new Lego themes?"

Gibson doled out dollar bills for correct answers, two dollars for bonus questions, and sent the workers racing around the store, giving sales pitches for toys like miniature Polly Pocket dolls.

It's a strategy that seems to be helping in Newton and other Learning Express stores, where staff know customers by their first names and help customers carry packages to the car.

"We do comparison shopping, but they offer great gifts and services here," said Michael Cocomazzi, who spent about $500 with his fiancee at the Learning Express in Hanover. ''We shop at Wal-Mart too, but they gift wrap here and even if you spend a little extra, it's worth it."

Learning Express knows it can't avoid other stores' promotions during the holiday season so it carefully choreographs its own. In late November when most shops are gearing up for their post-Thanksgiving sales, some Learning Express store owners pre-empted their rivals with a five-day sale that began the Monday before Thanksgiving.

''We have to get people before they spend their money at Best Buy and other big-box stores," explained Gibson, who said sales at his Newton store are slightly down for the year. ''It's the only way to make it."

Paul Sahagian, owner of the Learning Express in Needham, was tempted to hold another holiday sale after Thanksgiving when local rival Toys Etc. hosted a ''midnight madness" promotion during the first week of December.

Sahagian couldn't do it. Customers may love it, but as a small shop owner -- after advertising costs and the discounts -- he'd probably lose money. ''I have enough business," said Sahagian, whose sales are even compared with last year. ''I don't need to give stuff away."

If there's anything Learning Express owners regret this season, it's not getting more exclusive toys. As a small merchant, it's tough to negotiate deals with toy vendors.

Take the Playmobil dollhouse, which was supposed to be an exclusive for specialty stores but then started showing up in Targets. Another time, a vendor told Samuels that a castle was sold out -- then he saw a plentiful supply at Barnes & Noble earlier this month.

''It's embarrassing," Gibson said. ''But our customers are loyal."

In the last few shopping days before Christmas, Learning Express owners were ready for the season to end. Working as a franchise owner takes over their lives -- and their homes -- during the holidays.

They clutter living rooms and garages with unassembled toys and bicycles that don't fit in store stockrooms. On Tuesday, Samuels smiled gleefully at the thought that he would, for the first time this season, be able to park his car in the garage.

''It's just the greatest feeling," Samuels said. ''And my wife is pretty happy."

Jenn Abelson can be reached at abelson@globe.com.Read about the top-selling toys this holiday season at boston.com/business